NSAC's Blog

Senate and House Farm Bills by the Numbers

May 31, 2013

Note to Readers: With Congress on recess for the week, we are playing catch-up on our farm bill reporting. This post takes a closer look at farm bill funding issues. A second post covers Senate floor action on the farm bill. Earlier, we posted a review of Senate and House Agriculture Committee markups on the farm bill.

Farm Bill Funding Anomalies

The farm bill back-to-back “doubleheader” markups were not the only unusual feature of this year’s farm bill debate. Farm bill budgeting has also proceeded in an unusual fashion.

First, the Congressional Budget Office “baseline” for farm bill spending did not get published until the very same day the Senate Agriculture Committee marked up its bill. Normally the baseline is out months in advance of action on a bill, but was slowed by this year’s long and convoluted budget process. The baseline establishes what farm bill programs would cost over the course of the next decade if Congress took no further action and a new farm bill does not come to fruition. It is used as the measure against which new farm bill spending proposals are measured.

Second, the automatic, across-the-board budget cut (sequestration) policy the federal government is operating under makes farm bill budgeting more complicated than ever. The sequester cuts have already kicked in and are scheduled to continue for nearly the next decade unless Congress moves in the meantime to end or modify its current meat-ax policy.

Under current sequestration rules, farm bill conservation programs will be cut $2.1 billion over the next decade. Those cuts will be across the board for all farm bill conservation programs with the sole exception of the Conservation Reserve Program (CRP). Ironically, though CRP is exempt from sequestration, it is one of the two programs most heavily cut in the pending Senate and House farm bills.

Direct commodity payments will also be cut by $4.1 billion via sequestration. This is something of a moot point, however, because both the pending Senate and House farm bills terminate the direct payment program anyway.

That sequestration would cut a program Congress plans to terminate, and exempt a program from cuts that the normal farm bill process is planning to cut more heavily than other programs, demonstrates just how awful sequestration is as a coherent policy mechanism. Nonetheless, those sequester cuts are part of current policy and will continue to take a bite out of farm bill conservation spending each and every year unless Congress eventually decides to replace sequestration with something resembling actual legislating and serious decision-making.

Third, and most importantly for the fate of the farm bill, there has been no upfront agreement between the two houses of Congress on the level of spending for the new bill. Without such an agreement, which is usually part of the normal process, and with the two bills miles apart on funding — an $18 billion 10-year cut in the Senate bill versus a $33 billion in the House bill — a final agreement will be even more difficult. That difficulty will be magnified by the $16 billion difference between the two bills over the SNAP budget, an increasingly partisan conflict that could become the major stumbling block to getting a bill finished.

Funding Comparisons of the Two Bills

The following charts show estimates of the dollar amounts the two bills would cut relative to existing baseline (the spending estimate for the current law with no changes) over the coming decade according to the official scorekeepers at the Congressional Budget Office.

* The Administration has exempted crop insurance subsidies from sequestration.

** The two bills are not officially credited with savings from automatic budget cuts (sequestration) that are already assumed under current law, though political speeches and media reporting on the bills often include the two numbers added together.

*** This column contains CBO’s re-score of the 2012 bill for 2014-2023, instead of 2013-2022, reflecting the year delay caused by the failure to complete action on the farm bill on schedule in 2012.

Much of the media and political attention on the farm bill focuses naturally on the level of savings – and contribution to deficit reduction – provided by the two bills. Another way to view the bills, however, is the level of total projected spending, after accounting for the proposed cuts. The following charts show that information for the major spending titles.

* The baseline is an estimate of spending under current law if no changes are made.

** This chart excludes all of the titles of the farm bill other than the four big ones in terms of spending, which are, in descending order, nutrition, crop insurance, commodity programs, and conservation.

The different choices made by the two committees are fairly clear from these charts. While both committees want to claim the mantle of farm program reform, from a spending perspective both merely channel the vast majority of the savings from terminating the direct commodity payment program back into other subsidy programs. Although, the House bill spends a bit more in this respect, with a net cut of just 9.6 percent relative to the 11.5 percent cut in the Senate bill. By way of comparison, simply terminating direct commodity payment subsidies without plowing savings back into new forms of subsidies would result in over 30 percent savings. In other words, roughly two-thirds of the savings are simply rerouted into new forms of subsidies in both bills.

A second and more distinct difference between the two bills is over SNAP program cuts. The Senate held firm with the same roughly $4 billion cut as they had last year (prior to the re-score), while the House Committee chose to further increase their proposed SNAP cut, moving from a cut four times the size of the Senate cut last year to five times the size of the Senate cut this year. SNAP spending and policy remains the single most contentious issue in the farm bill between the parties and the houses of Congress.

Farm Bill Funding for Conservation

On the conservation title too, the Senate Committee left its overall spending decision more or less intact from last year, allowing sequestration to make up most of the difference between their score from last year and the re-score. However, within the title, the Senate bill made some significant internal changes. Rather than adjusting spending for all the programs, the new Senate bill decreases the cuts to the Conservation Reserve Program (CRP) but increases the cuts to the Conservation Stewardship Program (CSP), while holding the Environmental Quality Incentives Program (EQIP) relatively constant. The Senate-passed bill in 2012 and the version of the farm bill developed for the congressional Super Committee in 2011 kept cuts to CSP and EQIP relatively equal. The new Senate bill, on the other hand, goes in a new direction, using CSP alone as the funding source to make up the difference caused by the one-year delay and re-scoring of the farm bill.

The House Committee, in contrast, changed the size of the overall conservation cut in addition to making changes internal to the conservation title. The House Committee proposes to make up for its decision to make smaller cuts to commodity subsidies by increasing its conservation cuts. The pending House bill takes an additional 1 million acres out of the CRP (down to a total of 24 million acres versus the 25 million acres decided on last year) and doubles down on its proposed cut to the CSP.

The CSP cut proposed in the new House bill is 21 percent, significantly greater than the 11 percent cut in both the House-Senate farm bill proposal in 2011 and the Senate-passed bill in 2012, and greater than the 14 percent in the new pending Senate bill. Both the Senate and House bills aim to cut CSP more than any other conservation program,, with the House proposal in particular grossly disproportionate to the cuts proposed for all the other conservation programs.

* The bills would merge the current Wildlife Habitat Incentives Program into EQIP. These numbers reflect the combined program.

** The bills would merge the current Agriculture Water Enhancement Program, Chesapeake Bay Conservation Initiative, and Cooperative Conservation Partnership Program to form the new RCPP. These numbers reflect the combined program.

*** The bills would merge the current Wetlands Reserve Program, Grassland Reserve Program, and Farmland Protection Program into the new ACEP. These numbers reflect the combined program.

“Stranded” Programs

As NSAC has emphasized all year, the awful farm bill extension Congress adopted on New Year’s Day did not extend the entire farm bill, but rather left a large number of programs without any farm bill funding for 2013. Hence, one central question for the two bills working through the process again in 2013 is how these programs that were left high and dry for this year are faring. The following chart summarizes where things stand at the moment. Amendments to be considered on the Senate and House floors may still change some of these funding levels, hopefully for the better.

Comparison of Senate and House Bill Funding Levels for Currently “Stranded Programs”

* All the programs in this chart are currently funded for five years at a time, with funding therefore needing to be renewed each time Congress writes a new farm bill. The programs with the asterisks are those which one or both houses of Congress are now proposing to get permanent funding. Hence the funding listed for those programs covers ten years worth of funding instead of five. Those programs will not need to be re-funded in the next farm bill.

NSAC will continue to work to improve funding levels for these smaller, but critically important farm bill programs as the legislative process moves forward. The first opportunity to make improvements may come next week if the Senate votes on a pending Brown (D-OH) amendment to improve local and community food program funding and a pending Udall (D-NM) to improve funding for the Socially Disadvantaged Farmers and Ranchers program. Given the generally lower funding levels for some but not all of the stranded programs in the House bill, House floor action will likely also include efforts to improve funding levels for some of these currently stranded programs.

[…] will be supervising a smaller total area. Meanwhile, the National Sustainable Agriculture Coalition points out that most conservation programs will be cut by an extra $2.1 billion in total because of the […]